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Offshore company formation - Cyprus
Cyprus is at the north-eastern end of the Mediterranean Sea between Europe and Africa. It has a population of approximately 760,000 made up largely of Greek Cypriots and Turkish Cypriots.
TYPE OF TRADING COMPANY
International Business Company's ('IBC's') are incorporated in Cyprus under the Companies Law, Cap 113, as amended.
| Type of Company | Private Limited Company |
| Governing corporate legislation | Companies Law, Cap 113, as amended. Following changes to personal and corporate tax legislation in the summer of 2002, Cyprus signed the accession treaty for the EU on 16 April 2003. Full membership was effected on 1 May 2004. The new legislation came into effect on 1st January 2003. The corporate tax rate is 10% for all companies. More information on the new tax regime is available on request. |
| Time-scale for incorporation | About two weeks although a reduction in this time scale may be possible in cases where there is urgency. |
| Availability of ready-made companies | These are generally available. |
| The regulations governing availability of names | The name of each company must end with the word ‘Limited’ or its abbreviation ‘Ltd’. The Registrar will not permit registration of a name the same as or confusingly similar to that of an already registered company. No company may be registered under a name that, in the opinion of the registrar, is undesirable. |
| Minimum and maximum number of shareholders | Minimum of one, maximum of 50. Nominee shareholdings are permitted, as is the holding of shares on trust. |
| Statutory minimum paid up capital requirements | One share must be subscribed to at the date of incorporation but there is no requirement that this be paid up.
There is no minimum share capital requirement under statute. |
| Standard authorised capital | Usual authorised share capital is €10,000 Euros. Classes of shares available. The following classes of shares are available: registered (nominative) shares, preference shares, redeemable shares and shares with special (or no) voting rights. It is not permissible to have shares of no par value. |
| Denomination of share capital | Shares can be denominated in any recognised hard currency. |
| Residency requirement on shareholders or shareholders’ meetings | There are no residency requirements. Annual general meetings are required once in each calendar year and not more than 15 months may elapse between such meetings; first annual general meeting may be held within 18 months of the date of incorporation. |
| Information published relating to shares and shareholders | Issued capital notified on incorporation and annually together with a list of shareholders. |
| Minimum and maximum number of directors | A minimum of one director and one secretary are required. Where there is only one director and one secretary, they must be different persons. |
| Are corporate directors permitted? | The office of director or secretary may be held by a company |
| Nationality and residency requirements of directors | None. |
| Nature of the powers of the directors | Freely determinable by the company’s articles of association. General powers of management are usually given to the board of directors acting as a board, with provision for a possible limit on borrowing powers. |
| Directors’ meetings | No mandatory rules as to location and frequency. |
| Information published relating to directors | The directors’ names, addresses and nationality must be provided on incorporation and also when changes occur. There is no legal requirement to provide details of other directorships. Details of directors’ shareholdings are included in the general list of shareholders. There is no requirement to report separately. |
| Must accounts be prepared by the directors? | The Companies Law provides that proper books of account must be kept in respect of all sums of money received and expended, all sales and purchases of goods, and assets and liabilities. The first financial period may cover a period of not more than 18 months from the date of incorporation and, thereafter, the accounting reference period is a 12-month period coinciding with the calendar year. |
| Must such accounts be filed with the financial authorities? | All companies, are required to file accounts with the registrar, and accounts so filed are open to inspection by the public. In addition, financial statements must be filed with the tax authorities. |
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